China will revamp its cinema ticketing following instances of fraud. Photo: Christopher Thomond for the Guardian

China's media regulator is to bring in a series of measures to tackle fraud in cinemas, as film revenues there could have been hugely underestimated.

Illegal software is used to report cinema takings that are lower than the actual figure, to avoid paying film tax and fees to distributors, Variety reports. Meanwhile tickets are sold for one film and then a ticket for another written out by hand, so that cinemas meet quotas set for certain films – and deprive others of revenue.

To tackle the problems, a national ticketing platform is being set up that all cinemas must subscribe to. It's hoped that the changes will bring in the proper amount of tax and accurately distribute sales revenue, with box office figures potentially as much as 10% higher than reported.

Misreported or not, China's box office sales are at an all-time high of $3.6bn for 2012, driven in part by 34 foreign films being allowed by its quota system each year, rising from 20 (the extra 14 movies must be Imax, 3D or animated). The latest to get a Chinese release is David O Russell's 1970s FBI caper American Hustle, which topped the Oscar nominations list alongside Gravity. It will come out in March, with Frozen, The Hobbit: The Desolation of Smaug, the Robocop remake and I, Frankenstein also getting a release in the next two months.

The expanded quota rules brought with them a change in the amount of revenue the studios accrue from sales, from 13-17% to a flat rate of 25%, making China suddenly even more attractive a market. The UK is trying to capitalise on it: one of the successes from David Cameron's recent trade visit to China was a deal in which Sino-British coproductions can sidestep the foreign movies quota, allowing for greater access for British filmmakers. The US meanwhile continues to court Chinese audiences, with the latest co-production an action film about the ancient Terracotta Army fighting an alien invasion.

China's homegrown movie industry, while rarely breaking out into the west, is also thriving, with six of their top ten box office hits of 2012 made in China – including the number one film Journey to the West: Conquering the Demons, which accrued nearly $200m. Its lead Shu Qi is set to appear in another much-anticipated epic this year, playing a female assassin in Hou Hsiao-Hsien's historical martial arts thriller Nie Yinniang.